Background: It has been hypothesized that fatty acids derived from a diet high in saturated fat may negatively affect endothelial function more significantly than a diet high in unsaturated fat; nevertheless, the effects of the long-term ingestion of monounsaturated fatty acids on endothelial function have been poorly studied. Methods: To examine the chronic effects of monounsaturated (e.g., extra virgin olive oil (EVOO)) or saturated (e.g., margarine (M)) fatty acid-rich diets on the development of insulin resistance and endothelial dysfunction in rats, three groups of rats were fed control, high-EVOO or high-M diets for 20 weeks. Body weight, energy consumption, insulin resistance, lipid peroxidation and in vitro vascular reactivity with and without metformin were assessed during the study period. Results: Both high-fat diets produced obesity and insulin resistance. EVOO-fed rats showed smaller increases in total cholesterol and arterial lipid peroxidation when compared with M-fed rats. Vascular reactivity to phenylephrine and sodium nitroprusside was not modified, but the vasodilating effect of carbachol was especially reduced in the M-fed rats compared with the EVOO-fed or control groups. Metformin addition to the incubation media decreased the vascular response to phenylephrine; decrease that was lower in rats fed with both high fat diets, and increased the carbachol and nitroprusside effects, but the metformin-enhanced response to carbachol was lower in the M group. Conclusions: Our results suggest that feeding rats with high quantities of EVOO, despite producing obesity and insulin resistance, produces low levels of circulating cholesterol and arterial lipoperoxidation compared to M fed rats and shows a preserved endothelial response to carbachol, effect that is significantly enhanced by metformin only in rats fed with control and EVOO diets.